Federal bank regulators have halted for six months any new approvals of the sort of industrial banks that Wal-Mart, Home Depot and 12 other companies are seeking to establish.

The directors of the Federal Deposit Insurance Corp. made the decision to impose the six-month moratorium on approving applications for the so-called industrial loan corporations, or ILCs. Nearly 100 members of Congress from both parties recently asked the FDIC to put into effect such a halt to give lawmakers a chance to consider legislation that would block commercial companies from owning ILCs.

The directors voted informally, without convening a meeting, over the course of this week. It was the first major action taken by the FDIC under its new chairman, Sheila Bair. The FDIC will not make any final decisions on applications for the banks or for changes in control of existing banks and will not accept any new applications for six months, the agency said in a news release.

"Recently, the growth of the ILC industry, the trend toward commercial company ownership of ILCs and the nature of some ILC business models have raised questions about the risks of ILCs to the deposit insurance fund, and whether their commercial relationships pose any safety and soundness risks," the FDIC said.

The moratorium, which takes effect immediately and extends until next Jan. 31, will give the regulators time "to assess developments in the ILC industry, to determine if any emerging safety and soundness or policy issues exist involving ILCs, and to evaluate whether statutory, regulatory or policy changes need to be made in the oversight of these charters," the agency said.

The application of Wal-Mart Stores Inc., the world's largest retailer, to establish an ILC based in Utah has spurred opposition from banks, unions, lawmakers, and consumer and community organizations.

Wal-Mart insists that it has no plans to compete with community banks and has pledged to the FDIC to stay out of branch banking and consumer lending. Rather, the newly-chartered bank would be used to handle the 140 million credit, debit card and electronic check payments it processes each year, the company says.

There are now 61 ILCs with a total of about $141 billion in assets and $98 billion in deposits. Thirty-three are based in Utah, one of only seven states that grant charters for such banks. The banks are allowed to issue credit cards, take deposits and make loans; they cannot offer standard checking accounts if the bank's assets exceed $100 million.

Rep. Barney Frank (news, bio, voting record), D-Mass., a principal sponsor of the legislation to block nonfinancial companies from owning the banks, said Bair "has taken the right step in giving Congress the ability to consider the implications of the increasing efforts to use ILC charters to avoid the long-standing separation of banking and commerce."

A Federal Reserve official recently raised concerns at a congressional hearing about nonfinancial companies establishing banks, because, he said, the owners of federally insured ILCs are able to avoid the regulatory requirements that apply to owners of other types of insured banks overseen by the central bank.

Because the ILCs are federally insured, deposits in individual accounts are guaranteed up to $100,000 if any of them failed. The FDIC insurance fund, standing at some $49.2 billion currently, is financed by premiums paid by banks.